Press review: US to freeze North Koreans for nukes and Russian Far East seeks investors

Top stories in the Russian press on Friday, September 8

Nezavisimaya Gazeta: US seeks to 'freeze' North Koreans for testing nukes

Washington is set to punish the North Korean population for Kim Jong-un’s provocations. The US resolution circulating among the UN-Security Council member-countries, states that its Navy should be granted unprecedented powers to hunt down North Korean ships at sea and check whether they are carrying fuel or weapons. In addition to diplomatic pressure, the Pentagon has deployed four more THAAD missile systems to South Korea. In response, Beijing protested the move, but that did not prevent the US and Chinese leaders from discussing the issue over the phone, Nezavisimaya Gazeta writes.

The US-proposed resolution, which is expected to be put to a vote on Monday, would cause 25 million North Koreans to freeze this coming winter due to insufficient central heating.

If the parts of the resolutions that envisage the interception of vessels pass the UN Security Council’s vote, that could lead to the toughest standoff at sea since the 1962 Cuban Missile Crisis, the paper notes.

The Trump administration even repeated the warning that the US could stop trade with any country doing business with North Korea, hinting that China would be among them.

Andrey Ostrovsky, Deputy Director of the Russian Academy of Sciences’ Institute for Far Eastern Studies, explained in an interview with the paper that "China and Russia believe that sanctions will not solve the problem." "As for threats to sever trade, they will not influence Beijing’s stance. If Chinese-US trade stops, this is just going to affect American consumers," he warned.

China and North Korea both share a maritime and land border. That said, it’s unclear how third countries can control what goods are transported through it. Therefore, Washington's resolution and reality do not coincide here, the expert concluded.

Izvestia: Lebanon to request Russian weapons

Russian weapon supplies to the Lebanese Armed Forces will top the agenda of the upcoming talks between Russian President Vladimir Putin and Lebanon’s Prime Minister Saad Hariri who is scheduled to visit Moscow next week, Izvestia’s Lebanese political sources close to the premier said.

"The country needs Russian-made weapons. That will be a priority issue during the negotiations," one of the sources said.

Meanwhile, a Russian military-diplomatic source confirmed to the paper that the list of weapons in question had been agreed on at the Army-2017 forum in late August. "These are Kalashnikov assault rifles, sniper guns, including large-caliber, disposable grenade launchers and the RPG-7 grenade launchers," he explained.

First Deputy Chairman of Russia’s Federation Council (upper house) Defense and Security Committee Franz Klintsevich expressed confidence that it does make sense to supply weapons to the Lebanese military.

"That country’s armed forces are fighting terrorists. Besides, we have had historically good relations with Lebanon, and there are no obstacles whatsoever to their further development," the senator told the paper.

The current Lebanese prime minister who assumed office in December 2016 also has close ties with Saudi Arabia and the US, and that can affect the potential deal, prominent Lebanese military expert, retired Brigadier General Amin Hoteit, told Izvestia.

"Beirut is not completely independent in making decisions on weapons supplies. The government is under tremendous pressure from Washington, which does not support Lebanon’s contacts with any arms markets, except for the American one," the expert noted. "On the other hand, various political forces in Beirut are exerting pressure on the authorities to persuade it to enter the Russian and Iranian arms markets."

He added that Russia will supply weapons to Lebanon only if nationally-oriented forces gain the upper hand over the pro-American lobby.

Nezavisimaya Gazeta: Russia to encourage foreign investment in Far East

Russia’s Far East could be of considerable interest to foreign investors, and that can help rectify the region’s economy, experts interviewed by Nezavisimaya Gazeta said.

"First of all, it’s worth mentioning the possibility of supplying key raw materials, as opposed to other Asian regions. These include natural resources, fish, wood processing industry products and gold mining," said Yekaterina Novikova, Assistant Professor at the Plekhanov Russian University of Economics. "For us that could be a kind of a springboard for the region’s future development and for building up the whole country in the field of high-tech, as well as in machine-building, space exploration through the construction of the Vostochny spaceport, and cultivating tourism thanks to newly-built infrastructure. It also pays to focus on the construction of sea ports and the entire Far Eastern logistics infrastructure for more effective trade."

Russia’s Far East has lost about 1.9 million people since the early 1990s. In addition to the persisting demographic outflow, investment in fixed assets has been on the decline since 2012, while real incomes and housing construction rates have dropped since 2015.

In light of that, Russian President Vladimir Putin stated at the Eastern Economic Forum in Vladivostok on Thursday that he wants the economy of Russia and its Far Eastern region to be "modern, flexible and capable of adapting to rapid changes in the world."

Among the incentives promised to foreigners who are ready to invest over $10 mln into the region’s economy is a streamlined procedure for obtaining Russian citizenship.

According to Tatiana Mineeva, Vice-President of Business Russia, in addition to logistics and tourism opportunities, Russia’s Far East could be of interest to foreign investors due to its agro-industrial complex. "The Russian-Chinese Agricultural Fund launched last year is a good example of mutually beneficial investment cooperation. It supports export-oriented projects in agriculture and the food industry," she noted.

Vedomosti: Sakhalin-Hokkaido Bridge to be next decade’s epic project

The decision to build a bridge connecting Russia’s Sakhalin and Japan’s Hokkaido islands has been practically made, Vedomosti quotes Russian Presidential Envoy to the Far Eastern Federal District Yury Trutnev as saying. Plans are in store to build a railway to the Pacific coast and a bridge to Sakhalin.

Russian First Deputy Prime Minister Igor Shuvalov earlier said that Russia suggested Japan to jointly build an automobile road and a rail link between Hokkaido and the southern part of Sakhalin.

The construction of the bridge and the 500-kilometer railway has an estimated price tag as high as 500 billion rubles ($8.75 bln), said Mikhail Blinkin, Director of the Institute for Transport Economics and Transport Policy Studies. Given the rather difficult conditions and climate, high seismic activity and poor infrastructure, this figure is quite adequate, according to Dmitry Baranov, leading expert at Finam Management.

The project will pay off only if the project, in its entirety, to connect Sakhalin and Hokkaido is implemented, Blinkin noted. The corridor will have special significance only if a bridge to Hokkaido is built, Transport Minister Maxim Sokolov admitted, adding that this is going to be the foremost project of the next decade.

However, Infranews Director General Alexey Bezborodov viewed the project as expensive and useless in such a sparsely populated region. In his view, these funds could be used to connect many regional centers in Russia thus improving economic cooperation between them.

His stance is echoed by Natalya Zubarevich, Regional Program Director at the Independent Institute for Social Policy, who said that the construction of this bridge is pointless from an economic viewpoint, since Japanese businesses traditionally use tanker shipments to transport goods. She added that it would be more useful to develop ferry service with Sakhalin and roads along the island’s north. This is, above all, a political project, she concluded.

Kommersant: Russia pitches new oil project offer to ExxonMobil

Kommersant has learned about the possible amicable agreement between Russia and ExxonMobil, which insisted at the Stockholm arbitration court on being compensated for more than $600 mln in overpaid taxes on the Sakhalin-1 project. According to the paper’s sources, once ExxonMobil renounces its claims, it could get a minority stake in a large-scale oil project with Russia’s Rosneft, which will be offered through tax incentives. That would ensure economic compensation for the American energy giant for agreeing to abandon the legal battle.

One of Kommersant’s source asserted that the issue at hand is the Krasnoleninskoye field with the reserves of 750 million tonnes, which expects to receive benefits. In that case, even if Exxon gets a minority stake in the project, the company will be able to compensate its loses from the Sakhalin-1 project within the next few years.

Besides, this could be Exxon’s first project in Russia since 2014, when Western countries slapped sanctions on Moscow over Crimea’s incorporation into Russia.

Exxon was well aware of the fact that, even in the event of a positive court ruling, there could be problems with its execution. That looks like a sufficiently strong argument in favor of concluding an amicable agreement, according to A2 law firm partner Mikhail Alexandrov. He noted that the accord is sure to contain a clause about avoiding such disputes in the future.

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